An Employer Can Still Adopt a Retirement Plan for 2020. Jan 07
For Release: January 7th, 2021:
The deadline to adopt a plan is the due date of the employer’s tax return, including extensions.
- The plan is treated as adopted on the last day of the prior tax year
- The plan is limited to employer contributions (i.e., the need to adopt before deferrals can occur)
- For a defined benefit plan (including cash balance) the normal minimum funding deadline applies.
This is a great way to do profit sharing (which is less expensive administratively than a 401(k)) and/or a DB plan for your clients with good 2020 numbers. You just need to let us know if you have any questions or need a quote and we will get right back to you.